The benchmark London Interbank Offered Rate (Libor), needs to rebuild trust and integrity, but also needs to be regulated, said MEPs, Commissioners Barnier and Almunia and other financial experts, at Monday's Economic and Monetary Affairs Committee hearing on manipulation of interbank lending rates.

"I am so pleased to have had such a high-level panel attend the hearing who all recognise the seriousness of the Libor scandal and its impact on the real economy and ordinary people. I will be continuing my discussions with the Commission and market participants to get a new transparent and resilient benchmark regime for interbank lending, based on real time transaction data", said Arlene McCarthy (S&D, UK), the lead MEP on draft legislation on criminal sanctions against market manipulation.

Participants agreed that benchmarks such as Libor should be anchored in observable transactions and should be transparent. They also said that benchmarks should continue to be set by private businesses such as banks, with data-based objectivity, but since integrity and trust are public goods, they should remain under public control and supervision.

MEPs also voiced concerns about small firms' loss of trust in banks, conflicts of interest between banks and their clients, how to estimate the losses imposed by Libor manipulation on market players and how best to punish the offenders.